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The spiritual gift of India to the world has already begun. India's spirituality is entering Europe and America in an ever increasing measure. That movement will grow; amid the disasters of the time more and more eyes are turning towards her with hope and there is even an increasing resort not only to her teachings, but to her psychic and spiritual practice. -- Sri Aurobindo (from the message broadcast on the eve of August 15, 1947)

Tuesday, October 30, 2012

Adam
Smith was not “the Father of Capitalist thought”. He was a moral
philosopher who described society as he saw it and the people within it who
behaved in certain ways. He never knew the word “capitalism”
(it was not invented until 1854).

Adam
Smith never said there was an “invisible force” at work. He used a
metaphor of “an invisible hand” (popular in the 18thcentury and used
widely, mainly by theologians) on two occasions only to “describe in a more
striking and interesting manner” (Smith, "Lectures on Rhetoric",
1762, 1983, p 29), two instances in two quite separate instances, separated by
centuries, where the individuals concerned – “a proud and unfeeling landlord”
forget he shared his crop, and an18th-century “merchant” - worried about the
security of his capital if he sent it abroad in “foreign trade”, acted to
protect their interests.

I
am often asked why I spend so much time on this Blog bashing away at the
so-called idea of Adam Smith’s that “an invisible hand” of “markets”,
“supply and demand”, the “economy”, or whatever, so arranges the economy
(“miraculously”) that people left free to arrange their capital in the way they
choose in their “self-interest’ (even their “selfishness” claimed Paul
Samuelson), will inevitably advance the “best interests” of the
community. No such entity exists. The politics and
moral conventions of society decide how a society’s people behave…

The
“entrepreneurial spirit” gets going from a genuine freedom to do so. There
is no “invisible hand” awaiting release. And it didn’t come from Adam Smith in
the form it is widely known as today.

Even
in the most desperate of circumstances, where state corruption, criminal gangs,
and petty laws plague big and small entrepreneurs and their workers, as is
common in the city slums of Asia, and in gangster corrupted capitalism, much
entrepreneurial energy is found at work, if often “underground”, to keep ahead
of government inspectors, gangsters, and the money-lenders. Unleash
that entrepreneurial force and apply the advice of “markets where possible, the
state where necessary”, and stand back and stay back.

For
evidence just look at 20th-century Hong Kong
… and how the West really started in the 19th-century. Sure, we had
widespread slums to contend with, but without entrepreneurial-led markets, we
would still be there in those slums in the 21st century.

Director, Savitri Era Learning Forum SRA-102-C, Shipra Riviera, Indirapuram, Ghaziabad - 201014 (UP) India + 91 96500-65636
tusarnmohapatra@gmail.com
Aadhaar No. 3628 2075 7337 SELF posits a model of counselling and communicative action as an instrument in order to stimulate the public sphere. The model aims at supplementing the individual’s struggle for a successful social adjustment with more aspirational inputs so as to help one take an informed and balanced attitude towards life as well as society. Savitri Era of those who adore, Om Sri Aurobindo & The Mother.

Let us rationally believe that social events do not happen suddenly like an earthquake. Those begin to crop from the seeds sown. I praise your efforts; at least the new generation may get opportunity to understand perspectives of events and social equations. -- Rabi Kanungo (Intellectual Forum)***

Some things are sufficiently constant in human affairs - and self-interest, even greed, is among them - that they explain nothing."Greed" certainly can be unleashed to do harm, but it can also be harnessed to do good. -- Donald J. Boudreaux "Greed" Is Not an Explanation from Cafe Hayek***

The fact is that the relationships each of us has with our fellow citizens overwhelmingly are of the arm’s-length, impersonal variety. They are market relationships, governed chiefly by self-interest on both sides of each exchange. They are not the sorts of personal relationships that guide decisions made within households. They are, indeed, precisely the sorts of relationships that each of us has with strangers from foreign countries. The Nation Is Not a House from Cafe Hayek by Don Boudreaux***

Adam Smith never said anything like: ‘the common good emerges when everybody works for their own selfish interest’... In fact, Smith never spoke favourably of selfishness. Richard confuses him with Ayn Rand (1960s) or even Bernard Mandeville (1734). They both lauded selfishness (Rand by making it a virtue and Mandeville by making it a social compulsion – ‘private vice, public benefits’). But not Adam Smith; he called Mandeville's theory 'licentious'. -- Friends Like Richard Are No Help At All from Adam Smith's Lost Legacy by Gavin Kennedy

Adam Smith never endorsed a policy of, or the behaviour of, greed. That is to confuse Adam Smith with Bernard Mandeville, author of the Fable of the Bees, 1734 (written over the years 1704 to 1737), who made greed a private vice but a public good. Folly Of Relying on Poor Teaching from Adam Smith's Lost Legacy by Gavin Kennedy

I am familiar with the works of Adam Smith and know something about his use of the metaphor of ‘an invisible hand’, which he used once in 1759 in The Theory of Moral Sentiments at TMS IV.1.10: p 184, and once in 1776 in Wealth Of Nations (short-title) at: Book IV.ii.9: page 456. He also, for the record referred to ‘the invisible hand of Jupiter’ in an essay, unpublished in his lifetime, known by its short-title as History of Astronomy, when he described the ‘pusillanimous superstition’ in pagan societies. In none of these cases was his use of an invisible hand metaphor anything to do with how simple price markets work. Indeed, the operation of market choice is so simple that your charming six-year-old daughter can understand how they work. -- from Adam Smith's Lost Legacy by Gavin Kennedy